The ConocoPhillips Board of Directors oversees our SD positions and related strategic planning and risk management policies and procedures. The board delegates certain elements of its oversight functions to one or more of its five standing committees: Executive, Audit and Finance, Human Resources and Compensation, Directors’ Affairs, and Public Policy. Each committee, other than the Executive Committee, is made up of independent directors and convenes at least quarterly.
The Public Policy Committee (PPC) is responsible for identifying, evaluating and monitoring sustainability trends and risks that could affect business activities and performance. The PPC makes recommendations to the board and monitors compliance with the company’s programs and practices regarding health and safety protection and environmental performance, including climate change, water and biodiversity management; business operations in sensitive countries; government relations and political contributions; human rights and social issues; and corporate philanthropy. The PPC reviews sustainable development as a standing agenda item, including briefings and discussions on SD strategic priorities, to advance the SD risk management process, implementation of the greenhouse gas (GHG) emissions intensity reduction target, and the use of reporting and disclosure frameworks. In 2019, this included:
- Climate-related risk strategy, management, metrics and disclosure.
- Membership in the Climate Leadership Council.
- SD strategic priorities.
- Non-financial SD process audit findings.
- SD reporting and ratings.
- ESG engagement strategy.
- Respecting Indigenous Peoples.
- Biodiversity risks.
Other topics include climate-related risk scenarios and climate-related risk management strategy implementation, water sourcing and other priority SD risks concerning biodiversity and stakeholder engagement. Issues considered by the PPC are regularly reported to the full board.
Other board committees also address sustainability issues. The Audit and Finance Committee (AFC) mandate includes enterprise risk management (ERM). The AFC facilitates appropriate coordination among the board committees to ensure that our risk management processes are functioning properly with necessary steps taken to foster a culture of prudent decision-making throughout the company. The AFC receives annual updates on how enterprise risk is being addressed, mitigated and managed across the company, including sustainable development considerations that influence market, reputational, operational and political risks within the ERM system. The Human Resources and Compensation Committee oversees executive compensation and performance-based components, including sustainability performance. Annual incentive programs promote achievement of strategic milestones and objectives that address stakeholder issues essential to sustaining excellence in environmental and social performance.